The US is set to lose between $7bn and $14bn as a result of the ongoing federal government shutdown, according to the congressional budget office.
On Wednesday, the nonpartisan federal agency released its estimates in a new report to the House budget committee as the government shutdown reaches four weeks.
According to the report, the shutdown will also reduce the US’s GDP by one to two percentage points in the fourth quarter of 2025.
In his report, Phillip Swagel, the CBO director, said: “In CBO’s assessment, the shutdown will delay federal spending and have a negative effect on the economy that will mostly, but not entirely, reverse once the shutdown ends.”
“The effects of the shutdown on the economy are uncertain. Those effects depend on decisions made by the administration throughout the shutdown. In addition, how federal employees and contractors respond to the delay in compensation is uncertain,” Swagel added.
The US government shutdown stretched into its 29th day on Wednesday with no sign of an end to the crisis. The Senate remained deadlocked over spending legislation and on Tuesday Senate Democrats blocked a Republican-backed bill that would have funded federal agencies through 21 November.
Democrats have refused to support the bill to clear the 60-vote threshold for advancement in the Senate because it does not include funding for healthcare programs, or curbs on Donald Trump’s cuts to congressionally approved funding.
According to the CBO report, economic activity at the end of 2025 will be lower as a result of the shutdown, with the decline being driven by three factors: fewer services will be provided by federal workers, federal spending on goods, services and food benefits will be temporarily lower and a drop in overall demand will temporarily decrease production from the private sector.
The report laid out three loss estimates amid the government shutdown. If the government opens this week, a total GDP loss by the end of 2026 would be $7bn. If the shutdown lifts after six weeks, or around 12 November, the total GDP loss would be $11bn. The estimated losses after the eight-week shutdown scenario were projected to be $14bn.
The CBO added that although a government shutdown lasting four weeks would not affect federal spending for Supplemental Nutrition Assistance Program (Snap) benefits, how a longer shutdown would affect Snap benefits is uncertain.
The report comes as more than two dozen states – led by New York, California and Massachusetts – sued the Trump administration on Tuesday over its decision to suspend food stamps amid the shutdown.
Meanwhile, nearly 11,000 air traffic controllers, who are deemed essential workers, missed their first paycheck on Tuesday.
With two weeks of unpaid work, as well as staffing issues being reported across major cities including Chicago, Dallas and Nashville, Sean Duffy, the transportation secretary, has warned that another missed paycheck would be financially “harder [for employees] … as expenses continue to roll [in]”.
